Archives for May 28, 2018

Key Highlights

ETH price declined further and tested the $500-510 support area against the US Dollar.

There is a major bearish trend line forming with resistance at $545 on the hourly chart of ETH/USD (data feed via Kraken).

The pair may correct a few points from the current levels, but upsides may be capped by $545-550.

Ethereum price is struggling to recover against the US Dollar and Bitcoin. ETH/USD could consolidate around $520-545 for some time before the next move.

Ethereum Price Decline

There were nasty declines in ETH price below the $590 level against the US Dollar. The price declined sharply and broke a few important supports such as $560, $545 and $540. It tested the $500-510 support area where buyers appeared. However, the price is now trading well below the $555 pivot level and the 100 hourly simple moving average.

The recent low was near $505 before the decline was stopped. At the moment, the price is correcting higher and is testing the 23.6% Fib retracement level of the last decline from the $575 high to $505 low. However, there are many hurdles on the upside near $540-545. There is also a major bearish trend line forming with resistance at $545 on the hourly chart of ETH/USD. The 50% Fib retracement level of the last decline from the $575 high to $505 low is also near $540. Therefore, the $540-545 zone is likely to prevent any major gains from the current levels.

Looking at the chart, the price remains in a solid downtrend from the $590 swing high. On the downside, the $500 handle holds a lot of importance. A break below $505 and $500 may well clear the path for a push towards the $460 and $450 levels in the near term.

The rout has continued today following a mass Ethereum selloff in a couple of hours yesterday. Markets are tumbling precipitously towards $300 billion, their lowest point since mid-April and a key support level. Failure to hold this could send all cryptos down towards their end of March yearly lows. Bitcoin has floundered again losing 3% on the day and falling to $7,150. Ethereum has also been battered and all altcoins are currently bleeding. There are no cryptocurrencies showing gains in the top 50 during the morning’s Asian trading session.

We have to go back to the end of March to the last time every single crypto currency was bleeding. Technical analysts are warning of a bearish breakout as Bitcoin closes below a long term consolidation pattern. Ethereum has fared worse losing 6% on the day and falling to $530. There is a high probability of it falling further, below $500 which is currently a major support level.

In the top 25 the altcoins suffering the greatest losses at the time of writing are Bitcoin Cash down 9.5%, Tron crashing 13.5%, Nem losing 10.3%, VeChain down 10%, Bytecoin dropping 13.4%, Zcash down 12%, Icon losing 10.5% and Zilliqa shedding 12.5%. Looking at Coinmarketcap’s gainers and losers for the day shows a few obscure altcoins making positive moves signaling pump and dump action.

Total trade volume has increased a little over the past day from $13 to $17 billion but market capitalization has fallen 6.7% as $22 billion left the crypto space in 24 hours. Bears are currently smashing the markets which look like they could be heading back to the $270 billion level the same time two months ago. Since the monthly high of $470 billion on May 6, crypto markets had hemorrhaged 35%. Bitcoin market dominance is up to around 40% as Ethereum and all altcoins take a heavy beating for the third time in 2018.

Cardano could be due for a bounce as it approaches a support zone visible on the daily time frame.

Technical Indicators Signals

The 100 SMA is below the longer-term 200 SMA to signal that the path of least resistance is to the downside. This means that the downtrend is more likely to continue than to reverse.

The 100 SMA lines up with the short-term descending trend line to add to its strength as resistance. The gap between the moving averages is widening to reflect stronger selling pressure.

However, RSI is pulling up from oversold conditions to show that buyers are ready to take control from sellers. A bit of bullish divergence can also be seen as the oscillator made higher lows while price had lower lows.

Stochastic has also reached oversold levels to show exhaustion among sellers but has yet to turn higher to signal a return in buying momentum.

ADAUSD Chart from TradingView

Market Factors

Cryptocurrencies have been in the red for the past few days as the lack of positive industry updates has been a drag. This is at the same time as regulatory concerns returned, along with a pickup in risk aversion in the global financial markets.

The political situation in Europe is being blamed for the drop in risk appetite as elections in Spain and Italy could bring more uncertainty, driving traders to safe-havens like the dollar.

The US currency is currently supported by Fed tightening expectations but these could be affected by the NFP release on Friday. Analysts expect a stronger pace of hiring for May but of particular interest would be data on wage growth.

Note, however, that the first smart contract for Cardano is already live.

Key Points

Bitcoin cash price is under pressure and is currently trading below $920 against the US Dollar.

There is a short-term bearish trend line formed with resistance at $900 on the hourly chart of the BCH/USD pair (data feed from Kraken).

The pair may continue to move down and it could soon break the $875 support level.

Bitcoin cash price is in a bearish trend below $1,000 against the US Dollar. BCH/USD could accelerate declines towards $800 as long as it is below $960.

Bitcoin Cash Price Decline

There were further declines noted in bitcoin cash price below the $1,000 level against the US Dollar. The price corrected a few points yesterday, but the upside move was capped by the $1,000 level. A fresh downward wave was initiated and the price settled well below the $1,000 level and the 100 hourly simple moving average. It even broke the $950 and $900 support levels.

A low was formed at $872 and the price is currently consolidating losses. An initial resistance is near the 23.6% Fib retracement level of the last decline from the $1,000 high to $872 low. There is also a short-term bearish trend line formed with resistance at $900 on the hourly chart of the BCH/USD pair. Above the trend line, the next hurdle for buyers is near the $935 level. It is the 50% Fib retracement level of the last decline from the $1,000 high to $872 low. Moreover, there is another crucial bearish trend line with resistance at $970.

Looking at the chart, the price is clearly in a major downtrend. If sellers remain in control, the price may break soon break the $875 and $850 levels. On the upside, the $960 and $970 levels are important resistances.

Looking at the technical indicators:

Hourly MACD – The MACD for BCH/USD is mostly in the bearish zone.

Hourly RSI (Relative Strength Index) – The RSI for BCH/USD is near the oversold levels.

Mainstream media outlets in South Korea and Japan JoongAng and Nikkei have reported that the National Tax Agency (NTA) of Japan is fully aware that 331 investors in the Japanese cryptocurrency sector recorded a profit of $1 million through trading, generating more than $331 million in total. Chasing Cryptocurrency Taxes By the end of 2017,

Bitcoin price appears to have broken below a long-term consolidation pattern to signal a drop.

Price is also approaching the bottom of a smaller descending channel to show that the downtrend could carry on.

Technical indicators on this time frame also seem to be signaling that further losses are in the cards.

Bitcoin price could be gaining further bearish traction as it closed below the support of its daily symmetrical triangle.

Technical Indicators Signals

The 100 SMA is below the longer-term 200 SMA to confirm that the path of least resistance is to the downside. In other words, the selloff is more likely to resume than to reverse. The 100 SMA also held as dynamic resistance and the gap between the moving averages is widening to reflect strengthening bearish momentum.

RSI pulled out of the oversold region but is turning back lower to show that bears refuse to let up. Stochastic also moved back south without even reaching overbought conditions, which means that sellers are eager to stay in.

BTCUSD Chart from TradingView

Market Factors

Regulatory concerns and the selling of Mt. Gox bitcoin are two of the main factors being blamed for the recent slide in bitcoin price. There have been no other big industry updates lately, so it’s understandable that most investors are being spooked by the drop.

To top it off, risk appetite has been notably weaker on account of geopolitical risks in U.S. and in Europe. In particular, Spain and Italy are likely to undergo elections for its top leadership positions, and the uncertainty is weighing on the appetite for riskier assets and driving traders towards safe-havens like the dollar.

The US has the NFP report lined up later this week and stronger tightening expectations from the results could further boost the US dollar. On the other hand, a return in risk-taking on weak data and slower tightening expectations could lead to some profit-taking and a much needed BTC/USD bounce.

Yesterday’s Ethereum price movements were interesting. Within 70 minutes, Ethereum was down five percent in the process sliding to $500. That’s our previous support line and immediate bear targets in line with our previous analysis. Luckily for EOS supporters, it’s highly likely that EOS ETH dump is all but over now that their mainnet launch is less than three days away. If that is the case, ETH prices might steady.

From The News

From recent discussions at Reddit, Bitcointalk and other complementing forums, the Rothschild family seems to be making inroads into cryptocurrency. While the motive is shrouded in fear and excitement, the fact that a new old money coin backed by billions if not trillions of USD should be a cause of concern.

Like I said their objectives are not clear. Nevertheless, we can speculate that after buying Poloniex via Goldman Sachs which they own, odds are IMMO would most likely be a stable coin. It may be something like Tether but padded by Gold or some precious metals. That’s how these guys have been making their money running the UK’s Government bond markets in the last 200 years. For perspective, Tether through BitFinex have an account with a Dutch bank, Dutch bank ING. The Rothschilds own this bank.

Are “the Rothschilds” actually remotely as powerful and coordinated as the conspiracy theorists seem to believe, or are they just a group of old-money socialites and all that other stuff is overhyped?

It’s in the mix of all this uncertainty that capital injection is about to hit the market via a group of institution-like-individuals jolted Vitalik out of his comfort zone. Through Twitter he posed a question asking anyone interested to understand if these guys are but what people say about them. Do you think IMMO is a direct threat to the Ethereum Project?

Going on, did EOS deliberately dump more than 180,000 ETH at BitFinex with just three days to go before their mainnet launch? Everybody think they did. In their one year ICO, EOS has been selling ETH as they advance their cause of toppling Ethereum from the number two spot. EOS accounts show that they have 300,000 less ETH after yesterday’s mini crash.

Ethereum (ETH) Technical Analysis

Weekly Chart

Like most coins, Ethereum sellers continue to press the gas pedal. As we can see from the weekly chart, last week’s $170 depreciation of ETH prices was enough to push bears below a key support line at $650. Because of this inclination, trading this pair would be easy and all traders have to do is to wait for a pullback towards $650 and liquidate. After all, selling would be tagging along with bears as trade volume indicates. After last week, there was a sharp increment in trade volumes pushing prices below our previous support line as ETH closed at $570. In case you want to fine tune entries, using the daily or 4HR charts would prove useful.

Daily Chart

After yesterday’s EOS’s ETH dump, there was a mini flash with ETH prices hitting our immediate bear target at $500. However, on technical terms, yesterday’s bear candlestick qualifies to be a climactic candlestick simply because of spike in market participation. Of course, it’s precarious now. Trading against the trend is but a guarantee to lose money while timing bottoms is like catching a falling knife.

This is why I say staying calm and waiting for today’s candlestick to close is a superior trading strategy. If it ends bullish with strong volumes then buy on Wednesday. On the flip side, if those higher highs fail to break above $600 with light or below average volumes, the wait for sell signals to print on the 4HR chart and sell with targets at $360.

After yesterday’s spark in bear pressure, allegation of EOSIO dumping ETH took center stage. Hawk eyed traders and observers saw this sell off happening at BitFinex and chances are it is likely to drag other alt coins with it. Mind you, EOS and Tron mainnet launches is happening over the weekend and before then bear pressure might taper. This is sole reason why I recommend checking the 4HR chart for EOS or Tron bullish signals before trading.

EOS Price Analysis

It’s no doubt that EOS continues to draw the attention of investors, speculators and haters in equal measure. The thing is long term benefits of any coin and their user case is what ultimately draws value and that’s paramount for investors. Now, while Binance was increasing the number of EOS tradable pairs, there is a strong rumor going on that the EOS team was busy unloading Ethereum hence the flash crash. You see, all this boils down to the nature of blockchain’s transparency.

Observers could see this dump happening at BitFinex. Now, whether this is a climactic ending of a short term ETH bear move or not we are not sure. What we know for sure is that EOS floats on positive vibes and that might be an advantage in the next three or four days.

Price wise, there are no major changes. EOS prices are still oscillating inside May 24 bullish candlesticks and that’s impressive. The longer the consolidation, the better the momentum for buyers keen on buying at a discount. Currently, what I recommend is staying put and trading according to yesterday’s trade plan.

Litecoin (LTC) Price Analysis

Whenever there is a worthy mention of Bitcoin, expect Litecoin’s name to pop up. In Japan, six more cryptocurrency exchanges operating through Tokyo Stock Exchange listed companies are ready to list the top three cryptocurrencies and Litecoin. Remember, this is exclusive of the nine cryptocurrency exchanges that are currently licensed by the FSA. Indeed, this is but a big boost for Charlie Lee’s Litecoin because with every addition, there is capital injection drawing liquidity which in turn stabilizes coin prices.

After yesterday’s bear candlestick, prices are back to $110. This is a strong support zone. Taking into account current technical development, we should be waiting to see if there would be a break below $110 or if Litecoin buyers will reject lower lows. Either way, today’s candlestick influences medium term trend regardless of whether there is a break below or bounce off $110. Yes, while there is a long lower wick following yesterday’s bear candlestick indicating pockets of buy pressure, technicals don’t favor buying at the moment.

Stellar Lumens (XLM) Price Analysis

If anything, these series of lower lows tags well with yesterday’s projection. As visible from the chart, prices are on a slide. In the last 24 hours, Stellar Lumens has been on a slide losing five percent meaning bears have been successful in pushing prices below May 24 lows of 25 cents. I’m looking for sells in days to come with conservative targets at 20 cents today or tomorrow.

Tron (TRX) Price Analysis

Even in the midst of this bear run, Tron continues to draw support from various exchanges. OKex, one of the largest cryptocurrency exchanges in the world for example has announced support for the new Tron coin. Complementing this is good news that a former IBM Engineer, Taihao Fu, shall be joining Tron. As usual, Justin Sun couldn’t hold his joy. With this, he hopes that his ambition of creating “A New Code of Freedom” through their mainnet launch is in motion.

Technically, in light of yesterday’s depreciation, I shall be looking for short term sell. Even so, caution should prevail and for protection, trade with tight stops with targets at 5.5 cents. Like EOS, I strongly believe Tron shall find support today or some few hours before their mainnet launch.

IOTA (IOT) Price Analysis

Several projects are underway inside the Tangle. One of them is Oyster, a file storage project that rides on Tangle benefits including fast settlement and scalability. All they want to do is provide an alternative channel for mobile users to store their files and earn revenue through the internet. Uniquely, Oyster isn’t 100 percent blockless because their PRL (Pearl) tokens are ERC-20 but their Oyster Protocol depends on the Tangle.

Despite everything, yesterday’s depreciation was low in volumes. Yes, price broke below support. But if there is a confirmation of yesterday’s bear pressure in the course of the day, then chances are IOTA sellers might test $1. After all, we are in a down trend and $1 is a key psychological level.